Slide 1: 2015 Full Year Results
2015 FULL YEAR RESULTS Thierry Le Hénaff Chairman and CEO 3 MARCH 2016
Slide 2: 10-Year Successful Turnaround
10-YEAR SUCCESSFUL TURNAROUND STRONG FINANCIALS INNOVATIVE x3 EBITDA 5th year in a row in Thomson Reuters Top 100 global innovators 13.8% EBITDA margin (6.2% in 2005) €1.90 dividend* (no dividend at start) Strong pipeline in new materials and sustainable solutions Gearing < 40% (iso spin
Slide 3: A Strong Set of Results in 2015
A STRONG SET OF RESULTS IN 2015 SALES EBITDA FREE CASH FLOW (1) NET DEBT IN €BN IN €M IN €M IN €BN +29% +35% x21 -€0.4 bn 1.8 7.7 1,057 +442 1.4 6.0 784 Bostik cash-out: €1.6 bn +21 2014 2015 (1) Cash flow from operations and investments excluding the impact of portfolio management 3 2015 FULL YEAR
Slide 4: A Step Change in the Group's Profile
A STEP CHANGE IN THE GROUP’S PROFILE FY’15 sales by business segment FY’15 sales by region 24% 28% Cyclical businesses 44% 38% (Acrylics, 29% 41% Fluorogases, in 2014 in 2014 PMMA) 32% 29% 34% (39% in 2014) High Performance Industrial Coating North Asia Europe Materials Specialties Solutions America
Slide 5: Delivering on the Group's Ambition
DELIVERING ON THE GROUP’S AMBITION GUIDANCE ACHIEVED IN 2015 1,020 to 1,040 EBITDA (€m) 1,057 in 2015 35% mid-term EBITDA to cash conversion 42%(1) (normalized conditions) 5.5% 5.6%(2) Capital intensity (capex / sales) long-term ~14% 14.6%(3) Working capital on sales long-term ~1.5x 1.3x N
Slide 6: Full Year 2015
FULL YEAR 2015 RESULTS
Slide 7: 2015 Key Figures
2015 KEY FIGURES IN €M (EXCEPT EPS) 2014 2015 VARIATION Sales 5,952 7,683 +29.1% EBITDA 784 1,057 +34.8% EBITDA margin 13.2% 13.8% Recurring operating income 447 604 +35.1% Adjusted net income* 246 312 +26.8% Net income (Group share) 167 285 +70.7% Adjusted EPS* (euro) 3.72 4.23 +13.7% * Adjusted ne
Slide 8: Sales Breakdown by Business
SALES BREAKDOWN BY BUSINESS 10% Acrylics Coating Performance Additives 14% Solutions 24% Coating Resins 14% and Additives Technical Polymers 10% 2015 SALES €7,683 m Specialty Adhesives 11% PMMA (Bostik) 20% High Performance Industrial Materials 44% 9% Specialties 32% Thiochemicals 4% 8% Hydrogen Flu
Slide 9: Sales Bridge
SALES BRIDGE SALES IN €M Scope Volumes Price Currency of business +7.8% 7,683 +25.8% 5,952 +0.2% (4.7)% Moderate Mainly in Coating Bostik acquisition Favorable euro / worldwide growth Solutions US dollar FX rate Acquisition Ramp-up of new Lower raw of a stake in Sunke thiochemicals mat
Slide 10: Strategic Projects Driving Growth in 2015
STRATEGIC PROJECTS DRIVING GROWTH IN 2015 THIOCHEMICALS INNOVATION BOSTIK Kerteh (Malaysia) 6 growth platforms BIO BASED RAW MATERIALS NEW ENERGIES SOLUTIONS FOR ELECTRONICS EPS AND CASH ACCRETIVE EXCELLENT TECHNICAL FROM 1ST YEAR AND COMMERCIAL START-UP WATER MANAGEMENT LIGHTWEIGHT MATERI
Slide 11: Bostik: A Promising Start
BOSTIK: A PROMISING START EBITDA IN €M EBITDA MARGIN +30% vs 2014 14 to 15% 183 158 10.3% 11.2% 2014 2015* 2017 2014 2015 LT target target (2020e) FY’15 EBITDA up 16% versus 2014 Benefits from organic developments, lower costs, first synergies and positive FX EBITDA margin up 90 bp versus 2014 S
Slide 12: Bostik: Delivering on Strategy
BOSTIK: DELIVERING ON STRATEGY GROWTH INNOVATION BRAND OPENING Making the Bostik brand 3 NEW UNITS OF THE SMART HOUSE FLY ACROSS EUROPE Monterrey (Mexico) & A laboratory-house project Dallas (United States) for sustainable RIDE ALONG Bangalore (India) construction with the Tour de France 12 2015 FUL
Slide 13: High Performance Materials: Successful Integration of Bostik and Innovation
HIGH PERFORMANCE MATERIALS: SUCCESSFUL INTEGRATION OF BOSTIK AND INNOVATION IN NEW MATERIALS 2015 KEY FIGURES 2015 SALES DEVELOPMENT IN €M 2014* 2015 variation Volumes +0.1% Sales 1,730 3,358 +94.1% Prices (0.5)% EBITDA 314 506 +61.1% Bostik dilutive Currency +7.2% EBITDA margin 18.2% 15.1% impact R
Slide 14: Industrial Specialties: Very Good Performance Driven by All Business Lines
INDUSTRIAL SPECIALTIES: VERY GOOD PERFORMANCE DRIVEN BY ALL BUSINESS LINES 2015 KEY FIGURES 2015 SALES DEVELOPMENT IN €M 2014* 2015 variation Volumes +1.7% Sales 2,269 2,450 +8.0% Prices (0.2)% EBITDA 312 418 +34.0% Currency +8.6% EBITDA margin 13.8% 17.1% Rec. operating income 169 237 +40.2% Scope
Slide 15: Coating Solutions: Good Resilience
COATING SOLUTIONS: GOOD RESILIENCE 2015 KEY FIGURES 2015 SALES DEVELOPMENT IN €M 2014* 2015 variation Volumes (1.4)% Sales 1,930 1,849 (4.2)% Prices (13.9)% EBITDA 203 190 (6.4)% Currency +7.5% EBITDA margin 10.5% 10.3% Rec. operating income 112 72 (35.7)% Scope +3.6% 2015 HIGHLIGHTS 2015 SALES BY B
Slide 16: Strong Cash Generation
STRONG CASH GENERATION FREE CASH FLOW(1) IN €M Strong performance in 2015 +442 Solid EBITDA contribution Significant decrease in working capital partially driven by lower raw material costs 14.6% working capital on sales ratio(2) (16.1% in 2014) Capex significantly reduced at €431m (€470 m i
Slide 17: 2015 Cash Flow
2015 CASH FLOW In €m 2015 EBITDA 1,057 Strict working capital management supported Working capital variation(1) 122 by lower raw material prices Taxes (200) Current taxes excluding impact of Bostik PPA Cost of debt (79) Capital expenditure(2) (431) Others 9 RECURRING CASH FLOW 478 Non-recurring
Slide 18: Capturing Growth While Reducing Capital Intensity
CAPTURING GROWTH WHILE REDUCING CAPITAL INTENSITY CAPITAL INTENSITY CAPEX / SALES IN % Honfleur, France 2016/2017 Filtration and adsorption Changshu, China 7.9% 7.9% Organic peroxides – 1Q’16 6.8% Texas, US 2015 Fluorogases - 2016 5.6% Adhesives Mexico 2015 Bangalore, India 3Q’15 Adhesives Adhesives
Slide 19: Net Debt
NET DEBT NET DEBT IN €M EXCLUDING €700 M HYBRID BOND 1,888 1,773 1,632 1,379 1,379 900 923 Gearing 39% 39% 4% 35% -€509 m Net debt / EBITDA 0.9x 1.0x 0.2x 1.3x 154 31/12 31/12 31/12 31/12 31/03 30/06 30/09 31/12 2012 2013 2014* 2015 2015 2015 2015 2015 Net debt decreased quicker than anticipated sin
Slide 20: Balance Sheet
BALANCE SHEET IN €M 31 Dec 2014 31 Dec 2015 Non current assets(1) 3,607 5,399 €571 m net provisions for pensions and other employee benefits include: Working capital 958 1,067 €388 m provisions for pensions (€348 m end 2014) Capital employed 4,565 6,466 Impact of Bostik integration (€177 m provi
Slide 21: Dividend
DIVIDEND DIVIDEND AND PAYOUT RATIO IN € / SHARE AND IN % 1.90* Dividend increased to €1.90, up +2.7% 1.85 1.85 1.8 Reflects confidence in the Group’s solid cash generation and balance sheet 45% payout on 2015 adjusted net income 1.3 2.9% dividend yield (based on share price at year end) 1.0 51
Slide 22: Our Priorities Going Forward
OUR PRIORITIES GOING FORWARD
Slide 23: 2016 Priorities
2016 PRIORITIES FLUOROGASES THIOCHEMICALS Follow-up of antidumping cases in the US Pursue successful development of Malaysian platform Higher pricing on HFCs in Europe Further growth potential Further address competitiveness issues BOSTIK M&A Accelerate geographic expansion Implementat
Slide 24: 2016 Outlook
2016 OUTLOOK Cautious macro-economic approach: Moderate worldwide growth and contrasted dynamics by region Volatility in currencies, energy and raw material prices Strong organic momentum driven by: Continuous development of Bostik including ramp-up of synergies Progressive improvement of fl
Slide 25: Key Take-Aways
KEY TAKE-AWAYS Strong 2015 Portfolio profile Successful Bostik performance in step-up integration with attractive a contrasted environment growth potential € 2016 € High cash generation Projects well in place Committed to further with significant to support value creation for deleveraging performanc
Slide 26: Appendix
APPENDIX 4Q’15 RESULTS
Slide 27: Very Solid Q4 2015 with Usual Year-End Seasonality
VERY SOLID Q4 2015 WITH USUAL YEAR-END SEASONALITY SALES EBITDA FREE CASH FLOW IN €M IN €M IN €M +23% +29% x3.5 1,760 214 +207 1,431 166 +60 4Q’14 4Q’15 27 2015 FULL YEAR RESULTS
Slide 28: 4Q'15 Performance by Segment
4Q’15 PERFORMANCE BY SEGMENT IN €M 4Q’14* 4Q’15 variation HIGH PERFORMANCE MATERIALS BOSTIK: successful implementation Sales 420 843 +100.7% of strategy and benefit of first synergies TECHNICAL POLYMERS: strong developments EBITDA 67 115 +71.6% in PVDF PERFORMANCE ADDITIVES: good quarter EBITD
Slide 29: Disclaimer
DISCLAIMER The information disclosed in this document may contain forward-looking statements with respect to the financial condition, results of operations, business and strategy of Arkema. Such statements are based on management’s current views and assumptions that could ultimately prove inaccurate